Markets subdued ahead of raft of US economic data

LONDON (AP) — Markets were subdued Wednesday as investors awaited a run of U.S. economic figures and after Spain’s prime minister indicated his cash-strapped country would not request a bailout imminently.

The U.S. economy is in the spotlight this week, as is often the case in the first trading week of the month. A run of economic indicators will culminate with Friday’s non-farm payrolls figures for September, which often set the market tone after their release.

Ahead of those figures, investors will on Wednesday have the monthly private payrolls report from ADP to assess as well as a services sector survey from the Institute for Supply Management. A surprisingly strong manufacturing report earlier this week helped shore up markets.

“The key point to watch for ahead of Wall Street trading getting underway is going to be the ADP payroll reading as although Friday’s non-farms remain very much the main event, any early direction could see investors changing their tune once again,” said Fawad Razaqzada, market strategist at GFT Markets.

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In Europe, a survey of the continent’s services sector showed weakness in the key economies of Germany and France and sharp downturns in financially weakened countries like Spain.

By late morning in London, the FTSE 100 index of leading British shares was up 0.1 percent at 5,814 while Germany’s DAX was up 0.3 percent at 7,328. The CAC-40 in France was barely changed at 3,415.

Wall Street was poised for a soft open, with both Dow futures and the broader S&P 500 futures up 0.1 percent. The actual open will likely depend on the ADP figures, which will be released an hour before the bell.

Elsewhere, the euro was up 0.1 percent at $1.2928 and the benchmark New York oil price was 42 cents lower at $91.47 a barrel.

Investors have also become cautious since Spain’s Prime Minister Mariano Rajoy said this week that his government was not on the verge of asking for financial aid as it seeks to get a grip on tis public finances.

Spain is under pressure to ask for financial assistance from the European Central Bank to keep a lid on its borrowing costs but the government has been reluctant to do so because it may come with conditions on its budget policies. Germany is also pushing Madrid to delay such a move because the government in Berlin is wary of presenting yet another rescue plan for a vote in parliament.

Spain’s borrowing rates have come down since the ECB announced in September its new bond-buying plan. On Wednesday, the interest rate on the country’s 10-year bond was flat around 5.70 percent.

“There is a general consensus that Rajoy will wait until after the regional elections on October 21,” said Craig Erlam, market analyst at Alpari. “One thing that appears certain is that until we do see some progress here, we’re unlikely to see many big moves in the markets.”

Australia’s S&P/ASX 200 gained 0.1 percent to 4,438.60, a day after the country’s central bank cut its benchmark interest rate by a quarter percentage point in response to global economic uncertainties. Earlier, the benchmark touched its high point for the year at 4,454.60 in morning trading before dropping back.

Markets in mainland China and South Korea were closed for public holidays.